Rising oil prices help Shell more than double Q4 earnings

Royal Dutch Shell’s fourth-quarter earnings more than doubled as oil prices surged and the company benefited from cost cuts.

Net income jumped to $3.81 billion from $1.54 billion in the same quarter a year earlier, Shell said Thursday. The figure is in line with analyst forecasts. The average price Shell received for its oil rose 24 percent from a year earlier to $55.28 a barrel.

Shell said the drop in cash flow was due mainly to a $2 billion charge related to the cut in U.S. corporate tax rates approved by Congress last year. While Shell expects the changes to boost earnings, the company had to revalue its deferred tax position to account for the lower tax rate.

In a news conference, CEO Ben van Beurden insisted that Shell intended to be a “world class investment case,” but he had to repeatedly fend off questions from reporters about when exactly the share-buyback would take place.

Shell and other oil companies slashed costs and reined in investment as they sought to adjust to an era of lower oil prices after crude plunged to less than $30 a barrel in 2016 from more than $100 two years earlier. Even with the rebound in oil prices and earnings, van Beurden promised “continued discipline.”

Earnings excluding one-time items and fluctuations in the value of inventories — the industry’s favored measure of performance — jumped 140 percent to $4.3 billion in the fourth quarter.